AMSTERDAM, Aug. 21,
2023 /PRNewswire/ -- Zepp Health Corporation ("Zepp"
or the "Company") (NYSE: ZEPP) today reported revenues of
RMB0.65 billion (US$89.4 million); a basic and diluted net loss
per share of RMB0.29 (US$0.04); and a basic and diluted net loss per
ADS of RMB1.15 (US$0.16) for the second quarter ended
June 30, 2023. Each ADS represents
four Class A ordinary shares.
"In the second quarter of 2023, we were delighted to witness our
strategic transformation from a company heavily reliant on a single
customer for revenue to becoming a self-reliant, global smart
wearable and healthcare solution provider yielding early success,
as our self-branded products contributed 68% of our top line and
85% of our total gross profit. The increased mix of our
margin-accretive self-branded products, together with our optimized
retail channels, drove our overall gross margin to 22.0%, reaching
the highest level since the second quarter of 2021. Our Amazfit
brand's gross margin percentage experienced a remarkable 51%
increase year-over-year, which demonstrated the strength and
resilience of the brand." said Mr. Wayne
Wang Huang, Chairman and CEO of Zepp. "With unwavering
commitment to enhancing user experiences, expanding our offerings
and fostering a thriving user community, we anticipate sustained
quarter-over-quarter revenue growth on self-branded products in the
third quarter, fueled by the launch of new products."
"During the second quarter, we leveraged on AI technology and
our integrated supply chain to expand our product portfolio and
enhance existing product lines with intelligent features. Notably,
we introduced Amazfit Cheetah, our dedicated running smartwatch
series, featuring AI Chat for personalized coach-to-athlete
interactions and industry-leading GPS technology. Looking ahead, we
remain committed to refining our AI-powered products and services,
solidifying our global reputation for excellence and affordability
in all markets. As post-pandemic opportunities arise, we are
confident that our dedication to innovation and customer
satisfaction will fuel our trajectory of success in the smart
wearable and healthcare industry."
Mr. Leon Deng, Zepp's Chief
Financial Officer, added, "Our second quarter revenues came within
our guidance range at RMB648.3
million, down by 41.5% year-over-year due to lower
Mi Band sales. Nevertheless, our
self-branded sales showed resilient recovery, achieving a 12.7%
sequential growth during the second quarter, and a mild decline of
7.3% versus last year."
"Moreover, we delivered on our quarterly expenses run rate
target and successfully reduced our GAAP and non-GAAP operating
expenses to RMB215 million and
RMB204 million, respectively, thanks
to our continued ROI-oriented expenses management strategies across
supply chain, R&D, products and marketing. our operating loss
for the second quarter shrank to RMB72.4
million as a result of higher self-branded products gross
margin and tighter expenses control, compared with RMB110.6 million loss in the same quarter last
year. Meanwhile, our inventory has decreased to RMB743 million, reaching the lowest level in
three years. We have managed to maintain a positive operating cash
flow, which we utilize to reduce the Company's debt level
accordingly. Going forward, we will persist with our prudent stance
towards expenses, while investing responsibly with great discipline
in research and development and marketing activities to reinforce
our long-term position. We are optimistic about returning to
profitability in the near future."
Second Quarter 2023 Financial Summary
|
|
For the Three Months
Ended
|
|
For the Six Months
Ended
|
Number
in millions, except for percentages
and
per- share/ADS amounts
|
|
June
30,
2023
|
June 30,
2022[1]
|
June
30,
2023
|
June
30,
2022[1]
|
Revenue RMB
|
|
648.3
|
1,108.3
|
1,293.5
|
1,865.3
|
Revenue US$
|
|
89.4
|
165.5
|
178.4
|
278.5
|
Gross margin
|
22.0 %
|
17.9 %
|
19.0 %
|
18.8 %
|
Net (loss)/income
attributable to Zepp Health
Corporation RMB
|
(69.9)
|
(106.9)
|
(206.7)
|
(195.7)
|
Adjusted net
(loss)/income attributable to Zepp
Health Corporation RMB[2]
|
(59.2)
|
(94.4)
|
(172.0)
|
(170.0)
|
Diluted net
(loss)/income per share RMB
|
(0.29)
|
(0.44)
|
(0.85)
|
(0.79)
|
Diluted net
(loss)/income per ADS US$
|
(0.16)
|
(0.26)
|
(0.47)
|
(0.47)
|
Adjusted diluted net
(loss)/income per share RMB[3]
|
(0.24)
|
(0.38)
|
(0.70)
|
(0.69)
|
Adjusted diluted net
(loss)/income per ADS US$
|
(0.13)
|
(0.23)
|
(0.39)
|
(0.41)
|
Units shipped in
millions
|
3.8
|
6.3
|
7.3
|
10.0
|
[1] The US$ numbers in
2022 are referenced with the prior 6-K disclosures, where
translations from RMB to US$ are made at a rate of RMB6.6981 to
US$1.00, the effective noon buying rate on June 30, 2022 as set
forth in the H.10 statistical release of the Federal Reserve
Board.
|
[2] Adjusted net loss
attributable to Zepp Health Corporation is a non-GAAP measure,
which excludes share-based compensation expenses. The tax effect
from the adjustment of the Share-based compensation expenses is
nil. See "Reconciliation of GAAP and Non-GAAP Results" at the end
of this press release.
|
[3] Adjusted diluted
net loss is the abbreviation of adjusted net loss attributable to
Zepp Health Corporation, which is a non-GAAP measure and excludes
share-based compensation expenses attributable to Zepp Health
Corporation, and is used as the numerator in computation of
adjusted basic and diluted net loss per ADS attributable to Zepp
Health Corporation.
|
Second Quarter 2023 Financial Results
Revenues
Revenues for the second quarter of 2023 reached RMB0.65 billion (US$89.4
million), a decrease by 41.5% from the second quarter of
2022. The decrease in total revenues was mainly due to 67.2% and
7.3% year-over-year decreases in Xiaomi wearable products and our
self-branded product sales, respectively.
Total units shipped in the second quarter of 2023 decreased by
39.7% year-over-year to 3.8 million, compared with 6.3 million in
the second quarter of 2022. Over 90% of the decrease in total units
shipped was due to the decrease in Xiaomi wearable products.
Gross Margin
Gross margin in the second quarter of 2023 was 22.0%, 4.1%
higher than the same period of 2022. Despite the inventory
clearance efforts, we were able to improve the gross margin for
self-branded products, which reached its peak since the third
quarter of 2020, by making substantial improvement in the channel
and product mix.
Research and Development
Research and development expenses in the second quarter of 2023
were RMB89.3 million, a decrease by
30.8% year-over-year. This comprised 13.8% of revenues, versus
11.6% for the same period in 2022. The decrease was mainly driven
by our research projects optimizations. We focus on the products
functionality strength on health and sports, and apply strict ROI
approach in different projects and resource allocation among
different product lines. This realignment contributed to expense
savings while maintaining a high level of productivity. We are
committed to make adequate investments in research and development
while seeking opportunities to optimize productivity and pave the
way for the Company's sustainable growth.
Selling and Marketing
Selling and marketing expenses in the second quarter of 2023
were RMB71.6 million, a decrease by
33.9% year-over-year. This reduction can be attributed to a series
of expense efficiency improvement measures that we have implemented
since last year. These measures include streamlining retail
channels and optimizing personnel allocation in various sales
regions. These allowed us to operate more efficiently while
maintaining an active market presence. We will continue to invest
strategically in our brand, adopting an ROI-based marketing
strategy to ensure its ongoing growth and success.
General and Administrative
General and administrative expenses were RMB54.1 million in the second quarter of 2023, a
decrease by 24.6% year-over-year. This comprised 8.3% of revenues,
compared with 6.5% in the same period in 2022, and was largely
attributable to our personnel optimization efforts and strict
administrative expense control.
Operating Expenses
Total operating expenses for the second quarter of 2023 were
RMB214.9 million, a decrease by 30.4%
year-over-year, which accounted for 33.1% of revenues for the
period, as compared with 27.9% in the second quarter of 2022.
Adjusted operating expenses, which exclude share-based
compensation, were RMB204.2 million.
They hit a multi-year low record. The Company will continue to
scrutinize its expense base and do whatever it takes to achieve the
long-term profitability we have targeted on.
Operating Income/(Loss)
Operating loss for the second quarter of 2023 was RMB72.4 million, compared with operating loss of
RMB110.6 million for the same period
in 2022. The loss was mainly caused by smaller revenue scale.
Although revenue showed recovery from quarter over quarter, it
could not fully cover fixed operating expenses. The reduced loss
was primarily attributed to the improved gross margin and decreased
operating expenses. Adjusted operating loss, which excludes
share-based compensation, was RMB61.7
million.
Net Income/(Loss)
Net loss attributable to Zepp Health Corporation for the second
quarter of 2023 was RMB69.9 million, compared with RMB106.9 million of net loss in the second
quarter of 2022. The adjusted net loss attributable to Zepp Health
Corporation was RMB59.2 million,
compared with RMB94.4 million for the
same period of 2022.
Liquidity and Capital Resources
As of June 30, 2023, the Company
had cash and cash equivalents and restricted cash of RMB1,064.0 million (US$146.7 million), compared with RMB1,001.5 million as of March 31, 2023 and RMB997.1 million as of June 30, 2022. The increased cash balance was
largely from operating activities. In the meantime, we have managed
to reduce our debt level, including short-term and long-term bank
borrowing balance, by RMB34.3 million
in the second quarter.
The Company continued to manage its working capital and
inventory efficiently and reduced inventory levels to RMB742.6 million as of June 30, 2023.
Share Repurchase Program Update
The Company announced in its third quarter 2021 earnings release
that the board had authorized a share repurchase program of up to
US$20 million through November
2022. On November 21, 2022, the
board authorized a 12-month extension of the Company's share
repurchase program. Pursuant to the extended share repurchase
program, the Company may repurchase its shares in the form of
American depositary shares and/or ordinary shares through
November 2023 with an aggregate value
equal to the remaining balance under the share repurchase program.
As of June 30, 2023, the Company had used US$11.7 million to repurchase 4,143,127
ADSs. The Company expects to fund the repurchases under the
extended share repurchase program out of its existing cash
balance.
Outlook
For the third quarter of 2023, the Company's management
currently expects net revenues to be between RMB600 million and RMB800
million, compared with RMB1.21
billion in the third quarter of 2022.
This outlook is based on current market conditions and reflects
the Company's current and preliminary estimates of market,
operating conditions and customer demand, which are all subject to
change.
Conference Call
The Company's management team will hold a conference call at
8:30 a.m. Eastern Time on Monday,
August 21, 2023 (8:30 p.m. Beijing
Time on August 21, 2023) to discuss
financial results and answer questions from investors and analysts.
Listeners may access the call by dialling:
US (Toll
Free):
|
+1-888-346-8982
|
International:
|
+1-412-902-4272
|
Mainland China (Toll
Free):
|
400-120-1203
|
Hong Kong (Toll
Free):
|
800-905-945
|
Hong Kong:
|
+852-3018-4992
|
Participants should dial in at least 10 minutes before the
scheduled start time and ask to be connected to the call for "Zepp
Health Corporation".
Additionally, a live and archived webcast of the conference call
will be available at https://ir.zepp.com/investor.
A telephone replay will be available one hour after the call
until August 28, 2023 by dialing:
US Toll
Free:
|
+1-877-344-7529
|
International:
|
+1-412-317-0088
|
Replay
Passcode:
|
6736760
|
About Zepp Health Corporation (NYSE: ZEPP)
Zepp changed its name from Huami Corp. (HMI) on February
25, 2021 to emphasize its health focus with a name that
resonates across languages and cultures globally. The Company's
mission continues to be connecting health with technology. Since
its inception in 2013, Zepp has developed a platform of proprietary
technology including AI chips, biometric sensors, and data
algorithms, which drive a broadening line of smart health devices
for consumers, and data analytics services for population health.
Zepp is one of the largest global developers of smart wearable
health and consumer fitness devices, shipping 20 million units in
2022. Zepp Health Corporation is based in Hefei, China, with U.S. operations, Zepp
Health USA, based in Cupertino, California.
Use of Non-GAAP Measures
We use adjusted net income/(loss), a non-GAAP financial measure,
in evaluating our operating results and for financial and
operational decision-making purposes. Adjusted operating expenses
represent operating expenses excluding share-based compensation
expenses. Adjusted operating income/(loss) represents operating
income/(loss) excluding share-based compensation expenses. Adjusted
net income/(loss) represents net income/(loss) excluding
share-based compensation expenses, and such adjustment has no
impact on income tax. Adjusted net income/(loss) attributable
to Zepp Health Corporation is a non-GAAP measure, which excludes
share-based compensation expenses attributable to Zepp Health
Corporation, and is used as the numerator in computation of
adjusted net income/(loss) per share and per ADS attributable to
Zepp Health Corporation.
We believe that adjusted net income/(loss) and adjusted net
income/(loss) attributable to Zepp Health Corporation help identify
underlying trends in our business that could otherwise be distorted
by the effect of certain expenses that we include in net
income/(loss) and net income/(loss) attributable to Zepp Health
Corporation. We believe that adjusted net income/(loss) and
adjusted net income/(loss) attributable to Zepp Health Corporation
provides useful information about our operating results, enhances
the overall understanding of our past performance and future
prospects and allows for greater visibility with respect to key
metrics used by our management in its financial and operational
decision-making.
Adjusted net income/(loss) and adjusted net income/(loss)
attributable to Zepp Health Corporation, should not be considered
in isolation or construed as an alternative to net income/(loss),
basic and diluted net income/(loss) per share and per ADS
attributable to Zepp Health Corporation or any other measure of
performance or as an indicator of our operating performance.
Investors are encouraged to review the historical non-GAAP
financial measures to the most directly comparable GAAP measures.
Adjusted net income/(loss) and adjusted net income/(loss)
attributable to ordinary shareholders, presented here may not be
comparable to similarly titled measures presented by other
companies. Other companies may calculate similarly titled measures
differently, limiting their usefulness as comparative measures to
our data. We encourage investors and others to review our financial
information in its entirety and not rely on a single financial
measure.
Exchange Rate
The Company's business is primarily conducted in China. This announcement contains currency
conversions of RMB amounts into US$ solely for the convenience of
the reader. Unless otherwise noted, all translations from RMB to
US$ are made at a rate of RMB7.2513 to US$1.00, the effective noon buying rate on
June 30, 2023 as set forth in the
H.10 statistical release of the Federal Reserve Board. No
representation is made that the RMB amounts could have been, or
could be, converted, realized or settled into US$ at that rate on
June 30, 2023, or at any other
rate.
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates," "confident" and similar statements.
Statements that are not historical facts, including statements
about the Company's beliefs and expectations, are forward-looking
statements. Forward-looking statements involve inherent risks and
uncertainties. A number of factors could cause actual results to
differ materially from those contained in any forward-looking
statement, including but not limited to the following: the
cooperation with Xiaomi, the recognition of the Company's
self-branded products; the Company's growth strategies; trends and
competition in global wearable technology market; changes in the
Company's revenues and certain cost or expense accounting policies;
governmental policies relating to the Company's industry and
general economic conditions in China and the global. Further information
regarding these and other risks is included in the Company's
filings with the United States Securities and Exchange Commission.
All information provided in this press release and in the
attachments is as of the date of this press release, and the
Company undertakes no obligation to update any forward-looking
statement, except as required under applicable law.
For investor and media inquiries, please
contact:
In China:
Zepp Health Corporation
Grace Yujia Zhang
Email: ir@zepp.com
The Piacente Group, Inc.
Yang Song
Tel: +86-10-6508-0677
Email: zepp@tpg-ir.com
Zepp Health
Corporation
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Amounts in
thousands of Renminbi ("RMB") and U.S. dollars
("US$")
|
except for number of
shares and per share data, or otherwise noted)
|
|
|
|
As of December
31,
|
|
As of June
30,
|
|
|
2022
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
886,632
|
|
1,008,921
|
|
139,137
|
Restricted
cash
|
|
86,708
|
|
55,040
|
|
7,590
|
Term deposit
|
|
-
|
|
5,000
|
|
690
|
Accounts receivable,
net
|
|
682,103
|
|
458,358
|
|
63,210
|
Amounts due from
related parties
|
|
138,614
|
|
185,554
|
|
25,589
|
Inventories,
net
|
|
1,021,923
|
|
742,571
|
|
102,405
|
Short-term
investments
|
|
34,316
|
|
30,882
|
|
4,259
|
Prepaid expenses and
other current assets
|
|
108,252
|
|
125,831
|
|
17,353
|
Total current
assets
|
|
2,958,548
|
|
2,612,157
|
|
360,233
|
|
|
|
|
|
|
|
Property, plant and
equipment, net
|
|
100,605
|
|
78,727
|
|
10,857
|
Intangible asset,
net
|
|
123,300
|
|
108,971
|
|
15,028
|
Goodwill
|
|
66,081
|
|
69,474
|
|
9,581
|
Long-term
investments
|
|
1,686,628
|
|
1,694,778
|
|
233,721
|
Deferred tax
assets
|
|
210,186
|
|
258,938
|
|
35,709
|
Amount due from a
related party, non-current
|
|
6,333
|
|
6,746
|
|
930
|
Other non-current
assets
|
|
50,389
|
|
61,466
|
|
8,477
|
Operating lease
right-of-use assets
|
|
65,573
|
|
38,634
|
|
5,328
|
Total
assets
|
|
5,267,643
|
|
4,929,891
|
|
679,864
|
Zepp Health
Corporation
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Amounts in
thousands of Renminbi ("RMB") and U.S. dollars
("US$")
|
except for number of
shares and per share data, or otherwise noted)
|
|
|
|
As of December
31,
|
|
As of June
30,
|
|
|
2022
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
456,585
|
|
439,891
|
|
60,664
|
Advance from
customers
|
|
2,133
|
|
3,895
|
|
537
|
Amount due to related
parties
|
|
40,978
|
|
32,933
|
|
4,542
|
Accrued expenses and
other current liabilities
|
|
197,819
|
|
150,396
|
|
20,741
|
Income tax
payables
|
|
2,715
|
|
14,926
|
|
2,058
|
Notes
payable
|
|
456,438
|
|
495,457
|
|
68,327
|
Short-term bank
borrowings
|
|
512,000
|
|
221,000
|
|
30,477
|
Total current
liabilities
|
|
1,668,668
|
|
1,358,498
|
|
187,346
|
Deferred tax
liabilities
|
|
35,552
|
|
33,863
|
|
4,670
|
Long-term
borrowings
|
|
684,210
|
|
844,699
|
|
116,489
|
Other non-current
liabilities
|
|
162,602
|
|
163,652
|
|
22,569
|
Non-current operating
lease liabilities
|
|
31,690
|
|
11,597
|
|
1,599
|
Total
liabilities
|
|
2,582,722
|
|
2,412,309
|
|
332,673
|
|
|
|
|
|
|
|
|
Zepp Health
Corporation
|
UNAUDITED CONDENSED
CONSOLIDATED BALANCE SHEETS
|
(Amounts in
thousands of Renminbi ("RMB") and U.S. dollars
("US$")
|
except for number of
shares and per share data, or otherwise noted)
|
|
|
|
|
|
|
|
|
|
As of December
31,
|
|
As of June
30,
|
|
|
2022
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
Ordinary
shares
|
|
162
|
|
164
|
|
23
|
Additional paid-in
capital
|
|
1,690,879
|
|
1,725,567
|
|
237,967
|
Treasury
stock
|
|
(67,163)
|
|
(76,905)
|
|
(10,606)
|
Accumulated retained
earnings
|
|
942,848
|
|
736,187
|
|
101,525
|
Accumulated other
comprehensive income
|
|
105,796
|
|
120,549
|
|
16,624
|
Total Zepp Health
Corporation shareholders' equity
|
|
2,672,522
|
|
2,505,562
|
|
345,533
|
Noncontrolling
interests
|
|
12,399
|
|
12,020
|
|
1,658
|
Total
equity
|
|
2,684,921
|
|
2,517,582
|
|
347,191
|
Total liabilities
and equity
|
|
5,267,643
|
|
4,929,891
|
|
679,864
|
|
|
|
|
|
|
|
|
Zepp Health
Corporation
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(Amounts in
thousands of Renminbi ("RMB") and U.S. dollars
("US$")
|
except for number of
shares and per share data, or otherwise noted)
|
|
|
|
For the Three Months
Ended June 30,
|
|
|
2022
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
|
Revenues
|
|
1,108,288
|
|
648,343
|
|
89,411
|
Cost of
revenues
|
|
(909,945)
|
|
(505,801)
|
|
(69,753)
|
Gross
profit
|
|
198,343
|
|
142,542
|
|
19,658
|
Operating
expenses:
|
|
|
|
|
|
|
Selling and
marketing
|
|
(108,255)
|
|
(71,550)
|
|
(9,867)
|
General and
administrative
|
|
(71,694)
|
|
(54,072)
|
|
(7,457)
|
Research and
development
|
|
(128,991)
|
|
(89,293)
|
|
(12,314)
|
Total operating
expenses
|
|
(308,940)
|
|
(214,915)
|
|
(29,638)
|
Operating
loss
|
|
(110,597)
|
|
(72,373)
|
|
(9,980)
|
Other income and
expenses:
|
|
|
|
|
|
|
Interest
income
|
|
2,148
|
|
5,946
|
|
820
|
Interest
expense
|
|
(14,123)
|
|
(12,317)
|
|
(1,699)
|
Other income/(expense),
net
|
|
2,320
|
|
(783)
|
|
(108)
|
Gain/(Loss)
from fair value change of long-term
investment
|
|
(11,398)
|
|
3,792
|
|
523
|
Loss before income
tax and income from equity method investment
|
|
(131,650)
|
|
(75,735)
|
|
(10,444)
|
Income tax
benefits
|
|
13,018
|
|
11,612
|
|
1,601
|
Loss before income
from equity method investments
|
|
(118,632)
|
|
(64,123)
|
|
(8,843)
|
Net income/(loss) from
equity method investments
|
|
11,450
|
|
(6,003)
|
|
(828)
|
Net
loss
|
|
(107,182)
|
|
(70,126)
|
|
(9,671)
|
Less: Net loss
attributable to noncontrolling interest
|
|
(237)
|
|
(185)
|
|
(26)
|
Net loss
attributable to Zepp Health Corporation
|
|
(106,945)
|
|
(69,941)
|
|
(9,645)
|
Net loss per share
attributable to Zepp Health Corporation
|
|
|
|
|
|
|
Basic loss per ordinary
share
|
|
(0.44)
|
|
(0.29)
|
|
(0.04)
|
Diluted loss per
ordinary share
|
|
(0.44)
|
|
(0.29)
|
|
(0.04)
|
|
|
|
|
|
|
|
Net loss per
ADS (4 ordinary shares equal to 1 ADS)
|
|
|
|
|
|
|
ADS – basic
|
|
(1.74)
|
|
(1.15)
|
|
(0.16)
|
ADS –
diluted
|
|
(1.74)
|
|
(1.15)
|
|
(0.16)
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing net loss per
share
Ordinary share –
basic
|
|
245,702,834
|
|
243,550,673
|
|
243,550,673
|
Ordinary share –
diluted
|
|
245,702,834
|
|
243,550,673
|
|
243,550,673
|
|
|
|
|
|
|
|
|
|
|
|
Zepp Health
Corporation
|
Reconciliation of
GAAP and Non-GAAP Results
|
(Amounts in
thousands of Renminbi ("RMB") and U.S. dollars
("US$")
|
except for number of
shares and per share data, or otherwise noted)
|
|
|
For the Three Months
Ended June 30,
|
|
|
2022
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
(308,940)
|
|
(214,915)
|
|
(29,638)
|
Share-based
compensation expenses[2]
|
|
12,589
|
|
10,692
|
|
1,475
|
Total adjusted
operating expenses
|
|
(296,351)
|
|
(204,223)
|
|
(28,163)
|
|
|
|
|
|
|
|
Operating
loss
|
|
(110,597)
|
|
(72,373)
|
|
(9,980)
|
Share-based
compensation expenses
|
|
12,589
|
|
10,692
|
|
1,475
|
Adjusted operating
loss
|
|
(98,008)
|
|
(61,681)
|
|
(8,505)
|
|
|
|
|
|
|
|
Net loss
attributable to Zepp Health Corporation
|
|
(106,945)
|
|
(69,941)
|
|
(9,645)
|
Share-based
compensation expenses
|
|
12,589
|
|
10,692
|
|
1,475
|
Adjusted net loss
attributable to Zepp Health
Corporation[2]
|
|
(94,356)
|
|
(59,249)
|
|
(8,170)
|
|
Adjusted net loss
per share attributable to
Zepp Health Corporation
|
|
|
|
|
|
|
Adjusted basic loss per
ordinary share
|
|
(0.38)
|
|
(0.24)
|
|
(0.03)
|
Adjusted diluted loss
per ordinary share
|
|
(0.38)
|
|
(0.24)
|
|
(0.03)
|
|
|
|
|
|
|
|
Adjusted net
loss per ADS (4 ordinary shares equal to 1
ADS)
|
|
|
|
|
|
|
ADS – basic
|
|
(1.54)
|
|
(0.97)
|
|
(0.13)
|
ADS –
diluted
|
|
(1.54)
|
|
(0.97)
|
|
(0.13)
|
|
|
|
|
|
|
|
Weighted average
number of shares used in
computing adjusted net loss per share
|
|
|
|
|
|
|
Ordinary share –
basic
|
|
245,702,834
|
|
243,550,673
|
|
243,550,673
|
Ordinary share –
diluted
|
|
245,702,834
|
|
243,550,673
|
|
243,550,673
|
|
|
|
|
|
|
|
Share-based
compensation expenses included
are follows:
|
|
|
|
|
|
|
Selling and
marketing
|
|
1,297
|
|
891
|
|
123
|
General and
administrative
|
|
5,646
|
|
5,161
|
|
712
|
Research and
development
|
|
5,646
|
|
4,640
|
|
640
|
Total
|
|
12,589
|
|
10,692
|
|
1,475
|
Zepp Health
Corporation
|
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
(Amounts in
thousands of Renminbi ("RMB") and U.S. dollars
("US$")
|
except for number of
shares and per share data, or otherwise noted)
|
|
|
|
For the Six Months
Ended June 30,
|
|
|
2022
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
|
Revenues
|
|
1,865,338
|
|
1,293,526
|
|
178,385
|
Cost of
revenues
|
|
(1,514,755)
|
|
(1,048,139)
|
|
(144,545)
|
Gross
profit
|
|
350,583
|
|
245,387
|
|
33,840
|
Operating
expenses:
|
|
|
|
|
|
|
Selling and
marketing
|
|
(211,360)
|
|
(157,528)
|
|
(21,724)
|
General and
administrative
|
|
(129,855)
|
|
(103,973)
|
|
(14,339)
|
Research and
development
|
|
(275,399)
|
|
(207,167)
|
|
(28,570)
|
Total operating
expenses
|
|
(616,614)
|
|
(468,668)
|
|
(64,633)
|
Operating
loss
|
|
(266,031)
|
|
(223,281)
|
|
(30,793)
|
Other income and
expenses:
|
|
|
|
|
|
|
Interest
income
|
|
4,695
|
|
10,079
|
|
1,390
|
Interest
expense
|
|
(25,793)
|
|
(25,635)
|
|
(3,535)
|
Other income/(expense),
net
|
|
6,065
|
|
(2,768)
|
|
(382)
|
Gain
from fair value change of long-term
investment
|
|
40,300
|
|
6,919
|
|
954
|
Investment
income
|
|
-
|
|
234
|
|
32
|
Loss before income
tax and income from equity method investment
|
|
(240,764)
|
|
(234,452)
|
|
(32,334)
|
Income tax
benefits
|
|
29,765
|
|
36,346
|
|
5,012
|
Loss before income
from equity method investments
|
|
(210,999)
|
|
(198,106)
|
|
(27,322)
|
Net income/(loss) from
equity method investments
|
|
14,958
|
|
(8,934)
|
|
(1,232)
|
Net
loss
|
|
(196,041)
|
|
(207,040)
|
|
(28,554)
|
Less: Net loss
attributable to noncontrolling interest
|
|
(371)
|
|
(379)
|
|
(52)
|
Net loss
attributable to Zepp Health Corporation
|
|
(195,670)
|
|
(206,661)
|
|
(28,502)
|
Net loss per share
attributable to Zepp Health Corporation
|
|
|
|
|
|
|
Basic loss per ordinary
share
|
|
(0.79)
|
|
(0.85)
|
|
(0.12)
|
Diluted loss per
ordinary share
|
|
(0.79)
|
|
(0.85)
|
|
(0.12)
|
|
|
|
|
|
|
|
Net loss per
ADS (4 ordinary shares equal to 1 ADS)
|
|
|
|
|
|
|
ADS – basic
|
|
(3.16)
|
|
(3.39)
|
|
(0.47)
|
ADS –
diluted
|
|
(3.16)
|
|
(3.39)
|
|
(0.47)
|
|
|
|
|
|
|
|
Weighted average
number of shares used in computing net loss per
share
Ordinary share –
basic
|
|
247,598,751
|
|
243,947,113
|
|
243,947,113
|
Ordinary share –
diluted
|
|
247,598,751
|
|
243,947,113
|
|
243,947,113
|
|
|
|
|
|
|
|
|
|
|
|
Zepp Health
Corporation
|
Reconciliation of
GAAP and Non-GAAP Results
|
(Amounts in
thousands of Renminbi ("RMB") and U.S. dollars
("US$")
|
except for number of
shares and per share data, or otherwise noted)
|
|
|
For the Six Months
Ended June 30,
|
|
|
2022
|
|
2023
|
|
|
RMB
|
|
RMB
|
|
US$
|
|
|
|
|
|
|
|
Total operating
expenses
|
|
(616,614)
|
|
(468,668)
|
|
(64,633)
|
Share-based
compensation expenses[2]
|
|
25,645
|
|
34,684
|
|
4,783
|
Total adjusted
operating expenses
|
|
(590,969)
|
|
(433,984)
|
|
(59,850)
|
|
|
|
|
|
|
|
Operating
loss
|
|
(266,031)
|
|
(223,281)
|
|
(30,793)
|
Share-based
compensation expenses
|
|
25,645
|
|
34,684
|
|
4,783
|
Adjusted operating
loss
|
|
(240,386)
|
|
(188,597)
|
|
(26,010)
|
|
|
|
|
|
|
|
Net loss
attributable to Zepp Health Corporation
|
|
(195,670)
|
|
(206,661)
|
|
(28,502)
|
Share-based
compensation expenses
|
|
25,645
|
|
34,684
|
|
4,783
|
Adjusted net loss
attributable to Zepp Health
Corporation[2]
|
|
(170,025)
|
|
(171,977)
|
|
(23,719)
|
|
Adjusted net loss
per share attributable to
Zepp Health Corporation
|
|
|
|
|
|
|
Adjusted basic loss per
ordinary share
|
|
(0.69)
|
|
(0.70)
|
|
(0.10)
|
Adjusted diluted loss
per ordinary share
|
|
(0.69)
|
|
(0.70)
|
|
(0.10)
|
|
|
|
|
|
|
|
Adjusted net
loss per ADS (4 ordinary shares equal to 1
ADS)
|
|
|
|
|
|
|
ADS – basic
|
|
(2.75)
|
|
(2.82)
|
|
(0.39)
|
ADS –
diluted
|
|
(2.75)
|
|
(2.82)
|
|
(0.39)
|
|
|
|
|
|
|
|
Weighted average
number of shares used in
computing adjusted net loss per share
|
|
|
|
|
|
|
Ordinary share –
basic
|
|
247,598,751
|
|
243,947,113
|
|
243,947,113
|
Ordinary share –
diluted
|
|
247,598,751
|
|
243,947,113
|
|
243,947,113
|
|
|
|
|
|
|
|
Share-based
compensation expenses included
are follows:
|
|
|
|
|
|
|
Selling and
marketing
|
|
2,214
|
|
2,046
|
|
282
|
General and
administrative
|
|
11,872
|
|
15,944
|
|
2,199
|
Research and
development
|
|
11,559
|
|
16,694
|
|
2,302
|
Total
|
|
25,645
|
|
34,684
|
|
4,783
|
View original
content:https://www.prnewswire.com/news-releases/zepp-health-corporation-reports-second-quarter-2023-unaudited-financial-results-301905474.html
SOURCE Zepp Health Corp.